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Losing means losing

09 Jun 2017, 08:00 | Posted by: Paul Donovan | Tags: Paul Donovan

The UK Conservative Party has lost their majority in the House of Commons and is likely to form a minority government. The Democratic Unionist Party has indicated they might support such a government. Opinion polls suggested a 6% to 7% lead for the Conservatives; the outcome seems to be 3%.

The UK result is unlikely to provide strong and stable leadership. There is a risk of Eurosceptics gaining more influence. Expectations of a further election before the end of the Parliament must be high. In Scotland, a poor result for the Scottish Nationalist Party will raise questions about the mooted independence referendum.

The testimony of former US FBI head Comey has led to much political outrage, and political outrage is time consuming. The bias of political attention is likely to remain towards the Russian question rather than the legislative agenda.

Chinese price data came out, but is mainly a matter of local interest. Consumer prices are a food question, and Chinese export prices have limited impact on overseas inflation. German trade data is due and may be more interesting, given the focus on the German current account balance and the euro.